Aerospace supplier Meggitt confident of continued growth

AEROSPACE, energy and defence sectors supplier Meggitt has said it delivered strong growth during 2012 despite market pressures.

The company, which has a braking systems operation in Coventry and last year snapped up Birmingham components manufacturer Precision Micro, said it expected to see further growth in the year ahead, where its focus would be on cash generation.

In an interim management statement ahead of its AGM, Sir Colin Terry, Meggitt chairman, said: “The group delivered further good growth in 2012 despite a slowdown in our civil aftermarket and uncertainty around defence budgets worldwide.
Revenues grew 10% in the year, with the civil aerospace and military businesses performing well, and the energy businesses growing by an impressive 45%.

“Proforma revenues (excluding the effect of M&A) grew by 6%.  As a result, the group achieved underlying profit before tax growth of 12%, and underlying EPS growth of 13%.  The full year dividend was raised by 12%, demonstrating our continued confidence in the group’s prospects.”

He added that the group had seen excellent operational progress during 2012.  The integration of Pacific Scientific Aerospace is now largely complete, and the run-rate synergy target has been further increased to $25m per annum by 2014.
 
The management’s continued focus on cash delivered a free cash flow of £180.1m, and it launched its ‘raising the bar’ initiative which should result in industry-leading levels of quality, delivery and operational efficiency, and help to deliver a higher organic growth rate in the long term.  

“Proforma revenues grew modestly in the first quarter of 2013, and we continue to expect mid-single-digit revenue growth for the year, as advised at the time of the 2012 results in March,” he added.  

“As guided, growth will accelerate in the second half reflecting the anticipated recovery in civil aftermarket. The financial position of the group remains very strong, and we expect further improvement driven by our ongoing focus on cash generation.”

The statement covers the period from January 1, 2013 to April 30.